Pressure to open Napier-Gisborne rail line

Political pressure is mounting on the Government to consider re-opening the Gisborne to Napier rail line following the independent review criticising KiwiRail's closure of the network last year.

Hawke's Bay and Gisborne community and business leaders expect to meet with the Minister of Transport Gerry Brownlee this month to push the case for a second look at how to make the rail line economically viable.

They'll use the independent review by Business Economic and Research Limited (BERL) released this week as a tool to show how the line can be profitable.

KiwiRail has rejected the review while the Green Party said it showed the line could be run economically.

The review holds up Hawke's Bay and Gisborne's future timber industry as the saviour of the East Coast rail line but KiwiRail insists there's no promise or commercial agreement in site to make the freight route commercially viable.

Large-scale forest owners mainly in northern Hawke's Bay could produce a volume of 1.5 million square metres of radiata pine timber each year and half of this volume, about 750,000 tonnes, could be economically hauled on the Napier to Gisborne rail line, the review said.

Minor investment would be needed to improve access to forests and processing plants in Napier and Gisborne to make hauling timber by rail viable. There was also an increase in timber production from small growers and some of the product could be available to be hauled by freight trains as well.

The review said some forest owners saw rail as a way to reduce freight costs and restore some viability to the industry but it was not without its problems.

The costs of double handling timber from road to rail and back to road for final delivery made the operation uneconomic, especially for short hauls.

"To make rail attractive, there is clearly a need to be able to better tailor the rail service to the access needs of the forests, processing plants and ports," the review said. "There is undoubtedly some capital expenditure needed to improve access but these investments do not seem to be out of scale, given that significant volumes could be carried on the line permanently into the future."

The review said a spur line into the forests in the Mohaka area and new rail access to the Panpac processing plant could encourage more large-scale forest owners to use rail.